Revenues improve, board votes tomorrow on new estimates

By Patrick B. McGuigan

Published: 15-Feb- 2010

A rebound in gross production tax revenues will fill around $60 million of the shortfall previously projected for Fiscal Year 2010, Treasurer Scott Meacham told reporters today (Monday, February 15). Additionally, state officials are likely to raise tax revenue estimates by roughly twice that amount for next year.

The immediate practical effect of the news could reduce to some degree the differences between Governor Brad Henry and Republican leaders in the Legislature when it comes to authorization to tap the Constitutional Reserve, better known as the Rainy Day Fund.

In response to a question from CapitolBeatOK, Meacham declined to say how far apart the legislators and the governor still were. However, he said the chief executive  “had a good meeting on Friday” with President Pro Tem Glenn Coffee of Oklahoma City and House Speaker Chris Benge of Tulsa. He said the three men were “trading ideas back and forth” and were “close to getting those differences worked out.”  In previous stories, CapitolBeatOK has estimated the difference at perhaps $257 million.

Meacham’s analysis came during a state Capitol briefing on President’s Day (Monday, February 15).  Meacham prepared reporters for tomorrow’s meeting of the state Board of Equalization, where revised estimates for Fiscal Year 2011 will be considered, and final numbers for 2010 will likely be approved.

Based on Tax Commission reports, Meacham now projects some $120 million more available for FY 2011, an increase of 2.3% over December’s estimate. Tax funds available for expenditure in FY 2011 are $1.2 billion less, or 18.2% below what was appropriated for 2010. The total now projected available in FY 2011 is $5.4 billion.

The upward revisions for 2010 reflect several changes from the December estimates. The personal income tax estimate increased by $2 million or .1%, while corporate income tax estimates dropped by $25 million or 13.7%, Meacham said.

The Treasurer described sales tax receipts as “a little anemic for the last few months,’ and disclosed a decline of $13 million or .8%.

On the up side were strong improvements in taxes from energy sources. The gross production tax on natural gas was $94.9 million, 42.2% higher, while oil gross production taxes jumped by $43 million, 60.6% higher. Meacham provided details on energy price data. In December natural gas brought $3.92 mcf, but that has risen to $4.53 in February. Oil in December was at $66.83 bbl, and rose to $77.61 in February. To provide context, the NatGas price in February 2009 was $5.60 mcf.